Do you want some urgent money? Have you invested in some bonds? You can now get the loan against bond to cover your needs at a lower rate.
Not convinced? Let us provide you with some facts regarding the facility to help you know more and then decide!
What is the loan against bond?
A loan against bond is not a conventional loan where you need to pay a fixed monthly installment. These types of loans work similarly like an overdraft facility. You will only need to pledge your bonds, and its certain value will be given as the loan.
Compared to credit cards and personal loans, you can manage the loan against bond easily as it is available at a lower rate of interest.
Loan against bond – Some quick facts that you should know
1)The interest rate is lower than unsecured loans
The loan against bond interest rate could vary from lenders to lenders. It may also depend on your creditworthiness, type of pledged securities and lender’s conditions. Nonetheless, you should be sure of availing a lower loan against bond interest rate. It is as compared to unsecured loan options such as the personal loan.
2)Get a higher loan amount
When compared to any other type of loan, the loan against bond can offer you up to Rs.10 crore as per your collateral value and creditworthiness. Hence, with such a huge amount at your disposal, you can cover all your needs with just one loan.
3)A loan is provided against a wide list of securities
Most of the leading lenders let you borrow against a wide list of approved securities than just the bonds. These are shares, mutual funds, IPOs, life insurance policies, ESOPs, and FMPs that are accepted as the loan collateral by known creditors.
4)Nil foreclosure and part prepayment charges
If you want to make some part prepayment from your own sources, then it won’t attract any penalty for doing so. You may also don’t need to pay any charges for foreclosing the loan against bond account earlier than scheduled. This way, these facilities let you manage your loan account as per your needs and repayment capacity.
5)Flexi loan facility
When you apply for loan against bond with a leading lender, you don’t have to worry about paying the interest on the entirely sanctioned loan limit. Yes, you only need to be concerned about paying just the interest as EMI on the utilized amount. Suppose if your total loan limit is Rs.5 lakh and you borrowed a total of Rs.1 lakh.
Here, you only need to pay the interest on the utilized amount as the EMI and nothing else. The remainder of the balance amount gets adjusted after the closure of the loan duration. This way, you can easily save huge on making the repayments for the loan against bond.
6)Online loan account access
Applying for the loan against bond facility can also help you in managing the loan details 24/7 and from anywhere. You can easily do that when you access the loan details via the lender’s digital customer portals.
Loans can surely help you fulfil your multiple needs and make pending plans a reality. However, nor being aware of a loan and applying for it can lead to debt traps as well. Hence, it is better to know all loan related details before applying for it.